(Reuters) – U.S. wheat futures fell nearly 0.5 percent on Thursday, edging lower on pressure from a firmer U.S. dollar and profit taking after a steep rise in the previous session on fears of crop damage from dry weather.
FUNDAMENTALS
Chicago Board Of Trade May wheat down 0.5 percent to $7.12-1/2 a bushel, having closed up 3.4 percent on Wednesday. The grain is holding just off a five-month high touched in the previous session.
May soybeans fell 0.1 percent to $14.29-1/4 a bushel, having firmed 0.9 percent on Wednesday.
May corn fell 0.5 percent to $4.85-1/2 a bushel, having gained 0.3 percent in the previous session, and remains in the middle of its range of the past three weeks.
Wheat had drawn support from concerns over a lack of rain in the U.S. Plains and dust storms in Texas that threaten to cut production of hard red winter wheat.
Commodity Weather Group said there was very little potential for showers in the southwestern areas of the Plains wheat belt during the next two weeks.
Dry conditions have already taken a toll. In Kansas, 34 percent of the wheat crop was rated in good to excellent condition as of Monday, down from 37 percent a week earlier.
Supply concerns were in focus for soybeans as favorable crush margins have prompted processors to bid aggressively for the oilseed.
Traders said up to five cargoes of Brazilian soybeans could be headed to the United States because they were more affordable than U.S. supplies.
MARKET NEWS
The dollar traded at two-week highs against a basket of major currencies early on Thursday, having posted solid gains after comments from Fed Chair Janet Yellen prompted markets to bring forward interest rate hike expectations.
Brent oil futures fell on Wednesday as worries over sanctions affecting Russian oil supplies eased, while U.S. crude oil rose on an inventory draw at the benchmark’s pricing hub and ahead of the front month contract’s expiration.
U.S. stocks fell on Wednesday after comments from Federal Reserve Chair Janet Yellen raised the possibility of an earlier- than-anticipated increase in interest rates.
